Some Cash On The Side To Pay Off, Spare-time Work At Home Requires Careful Planning And Steady Effort.

January 2, 1989|By SARAH OATES, Orlando Sentinel

Karen Stella wanted to earn some extra money, but she did not want to give up all her time with her two preschool children. After toying with the idea of selling food-storage products, she decided instead to sell Avon cosmetics and jewelry.

In the first few months, Stella, 31, sold about $200 worth of Avon items each month. But as she became a better saleswoman and found regular customers, her orders grew to $400 to $600 a month.

Stella, who sells Avon products for about 10 hours each week, said that her earnings each month from commissions -- roughly $200 -- go into the family savings account or are spent on Heather, 5, and Greg, 3.

For Stella, learning how to sell paid off. ``It was hard, but it was like when you`re taking a dose of medicine. You just hold your breath and do it,`` she said.

Stella has joined the army of workers in the United States who devote spare time to earning money. Millions of people sell goods -- including cosmetics, cleaning products, educational products -- or start their own businesses, such as office-cleaning or car-repair services, in their leisure hours.

But spare time does not automatically translate into extra money. Success in work at home takes careful planning, cautious selection of the work and steady effort.

Before you begin, determine how much time you can spend on the endeavor and how much money you would like to earn. With those two limits in mind, find an enterprise that fits your talents and interests. Be wary of get-rich-quick schemes that ask you to spend money up front.

``You have to have initiative. You have to be a self-starter. You have to be able to plan and schedule and (have) discipline,`` said Karen Boane, an Avon district sales manager in Orlando.

Two of the most common ways of earning money in your spare time are by working in direct sales or starting your own business.

Some of the best-known direct-sales companies -- Avon, Tupperware Home Parties, Mary Kay Cosmetics and Amway Corp. -- market their products through part-time sales staffs. The workers sell their products, usually in their homes, to friends, relatives, neighbors and other people they contact. The worker gets a sales commission and sometimes receives bonuses, especially for recruiting others to sell the products.

In 1987, more than 3.6 million people were working in direct sales, said the Direct Selling Association in Washington. That sales force sold $8.8 billion worth of goods and services in 1987, which is an average of about $2,440 for each seller.

The annual turnover rate in direct-sales staffs is about 100 percent, association president Neil H. Offen said. While some people stick with selling Mary Kay cosmetics or Tupperware food-storage units for years, others stay in for just a few months, he said. People leave the business rapidly if they have earned enough money or find that they do not like the work.

Most of the workers are part time, he said. More than 88 percent of them work fewer than 30 hours a week, and 78 percent of them are women, he said.

In almost every case, the sellers work as independent contractors, and are responsible for paying their own income taxes and making their own Social Security contributions. The companies generally do not provide benefits.

Many people start small businesses at home to supplement their income, said James Hahn, associate director of the Small Business Development Center at the University of Central Florida in Orlando. The center, like its counterpart in South Florida, gives free advice to people who own or are planning to start small businesses.

Problems often develop when the business gets too large for the individual to handle in his spare time but is still too small to support the owner, Hahn said.

``It will reach the stage where it needs more attention,`` Hahn said. For example, a worker might earn $20,000 at a full-time job, $5,000 fixing cars on weekends and eventually find that he must work 80 hours a week to keep his annual income at $25,000.

One of the biggest mistakes people make when they start small businesses is failing to have enough capital for advertising or equipment to get them off the ground.

A monetary goal is important because it gives a spare-time worker something to strive for, said Boane of Avon. For example, if your job has a net pay of $1,200 a month and your household expenses total $1,400 a month, you would need to earn $200 a month extra to make ends meet. But if your goal is to save for a $1,500 trip, you would need to earn only $125 a month for one year.

Once you have decided how much money you need and how much time you have for the work, choose what you want to do.

If you want to sell, choose a product you like and use, Offen said. That will make pitching the product to prospective buyers easier. ``There`s usually something that a direct seller believes in. That certainly distinguishes them from a clerk in the store who couldn`t care less,`` he said.